Housing Minister Nick Smith has defended legislation that enables the Government to over-ride councils and free up land for development in areas where new homes are needed.

Dr Smith, appearing before Parliament's social services committee yesterday, said the legislation was a last resort and the Government would prefer to reach accords over housing development, such as the Auckland city housing accord.

He stood by the new Housing Accords and Special Housing Areas Bill, which allows councils and the Government to create areas where consenting is streamlined and would not be subject to district planning restrictions.

Labour housing spokesman Phil Twyford asked Dr Smith why there was no mechanism in the bill to require developers to build affordable houses.

Dr Smith said that when people moved into new, more expensive houses it would free up older homes which might be more affordable. He used the example of someone buying a $750,000 house, moving out of one worth $450,000.

Mr Twyford and social development spokeswoman Jacinda Ardern, also on the committee, called it "trickle-down housing".

Dr Smith rejected the comparison.

"You need to consider ... there will be very few people on this committee whose very first house was a new one," he said.

"I don't expect the bulk of first-home owners would be moving into a new house. They never have and they never will."

Affordable housing would be a condition of some consents under accords but it would not apply to every special housing area.

Dr Smith was also quizzed over provisions in the bill for the Government to over-ride councils, and take control of planning and consenting for homes if an accord broke down.

Mr Twyford asked Dr Smith why he had introduced the legislation after signing the Auckland accord, which promised not to use over-ride powers.

Dr Smith said the Government had been clear it would look to intervene in the market to help ease the housing affordability problem.